Jetleap takes the sting out of Cyber Monday shipping costs

A major study by international online payments firm PayPal places Israelis among the biggest international internet buyers in the world. According to the study, over 2.5 million Israelis bought something online over the past 12 months – 82% of them from an international site, usually in the US or China.

Israelis would buy even more online, according to Effy Dahan, regional PayPal manager for Israel and Africa, if high shipping costs didn’t hold them back. For those shopping online at US sites, there’s a new service called Jetleap that could make shipping charges a bit easier to stomach.

Jetleap is a platform that connects, for a fee, people in Israel who need something delivered from the US with travelers who are flying that route. This means, said Jetleap CEO Ayal Ebert, Israelis can order to their heart’s content and get their merchandise hand-delivered by a traveler who is flying into Israel.

Online commerce in Israel got a huge boost in 2012 when the government removed import duties on purchases of nearly all items valued at up to NIS 1,200 (about $325; purchase tax and value added sales tax apply to the purchase of some items), and Israelis have been taking full advantage of the new rules, the PayPal study shows. Over 90 percent of Israelis used the Internet to either buy something or pay bills. The biggest shopping day for Israelis online in recent years was Cyber Monday – the Monday after Thanksgiving that is the online equivalent of Black Friday, when the best bargains are supposed to be available.

International commerce is good for PayPal, which handles millions of online transactions by Israelis each year, said Dahan.

“Israelis are smart consumers and they like bargains, which are easy to find online,” he said. “Over the past year we have seen online purchases jump 100%, and with shopping season here again, we expect similar levels of growth this year.”

PayPal is one reason online purchases have taken off here, said Dahan. PayPal allows users to pay for items online without submitting their credit card data, meaning that if the site they purchase from is hacked, the only thing hackers will find is the Paypal confirmation that it has collected payment from a customer on behalf of the online merchant, with no credit card data (PayPal collects the money from a customer’s credit card and forwards it to the purchase site). While he did not reveal specifics, Dahan said that PayPal was very popular among Israelis for online purchases.

The PayPal numbers show that Israelis will buy almost anything online – from clothes to electronics to cosmetics to books and DVDs, and even auto parts. They do this, said Dahan, because on many items they are getting a better deal online – even taking into account VAT and shipping charges – than they could get locally. In addition, many of the items purchased online are not available in Israel at all.

If anything is holding back Israels from purchasing online, said Dahan, it’s the often onerous shipping charges that many online retailers charge, but a search of the internet yields dozens of shopping sites that offer free or low cost international shipping; shoppers can find a list of many of these sites here and here.

Ayal Ebert (Photo credit: Courtesy)

Often, though, shoppers want something from a site that doesn’t offer free shipping, or from a site that doesn’t ship to Israel at all – and for them Jetleap could be a great alternative, said company CEO Ebert. Users register with the site and list the item they are looking to import – a laptop, for example – and list how much they would be willing to pay a traveler to bring that item in. The buyer submits the fee to Jetleap, which then pays the “importer” when the item arrives, sans a 10% fee Jetleap takes for the service. Taxes and import duties are the responsibility of the buyer, and Jetleap reminds users several times that they are responsible for complying with the law, said Ebert.

Prices vary depending on how badly the customer needs the item; to bring in an iPhone 6, for example the offered fees ranged from $35 to $120, with the assumption being that the more travelers stand to earn, the more willing they will be to take on the responsibility of bringing the item in. Everything is insured, “so that if the item a customer orders breaks or is stolen, they get their money back, and a refund of the shipping fee,” said Ebert, adding that so far, no one has filed any claims.

Site users needn’t worry that tax officials are going to use the Jetleap site to snoop on them. “Our data is stored on computers outside Israel, so there is no danger that customs authorities will have access to the information about buyers and sellers on our site,” Ebert said. “There are many legal protections for sites like this, and the likelihood that authorities will succeed in getting a court order for our data is nil.”

Most of the free or low-cost shipping sites sell clothing, small electronics, or other very small – and lightweight – items, but often people need something that’s too big to fit in a one kilo drop-ship box. “We get people seeking to bring in guitars, laptops and other valuable electronics they don’t trust to the mail, and even auto parts,” said Ebert.

Many Israelis already “hire” couriers to transport goods in this manner and, in fact, many people in countries around the world do it. But Jetleap is the first online platform to match up carriers and customers, and it does so more safely. “All users must sign up with their Facebook accounts. We use advanced algorithmic systems to ensure each and every profile is absolutely real,” said Ebert. “Users can post ratings for the couriers, meaning that those bringing the packages in will most likely do a good job, as they are concerned for their online reputations.”

For now, Ebert is concentrating on the US-Israel route, but he plans to expand to other countries in the near future. “The site has been online for just a month, and we have done practically no PR, but people are finding their way to us by word of mouth,” said Ebert. “Each day we get new inquiries, and we have already ‘closed’ dozens of deals. The most successful start-ups are the ones that answer a proven need, and the need for Israelis – and others around the world – to get someone reliable to bring them items from abroad is definitely a proven need. It happens all the time, and that’s why Jetleap is going to be a huge success, I believe.”